The FCA has published its policy statement on restricting CMC charges for non-PPI financial products and services claims. This follows the FCA’s corresponding consultation which ran from 21 January to 21 April 2021.
The statement sets out new rules which include the imposition of a fee cap on CMC charges which aims to protect consumers by preventing higher than necessary fees. The FCA will annually monitor the effect of the cap on the market and consumers, and will review its effectiveness in the years to come. The new provisions also enhance the information that CMCs are required to disclose to customers in the pre-contract stage to assist them in making better-informed decisions.
Whilst the new rules apply only to CMCs managing claims relating to non-PPI financial products and services, the minor changes to CMCOB affect all CMCs regulated by the FCA.
The new rules and guidance will enter into force on 1 March 2022.